CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited) for the Three-Month Period Ended 31 March 2020 Together with Independent Auditors’ Review Report

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ETIHAD ETISALAT COMPANY (A Saudi Joint Stock Company) CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited) For the three-month period ended 31 March 2020 Together with Independent Auditors’ Review Report

Contents

Independent Auditors’ Review Report ...... 2 Condensed consolidated interim statement of financial position ...... 4 Condensed consolidated interim statement of profit or loss ...... 5 Condensed consolidated interim statement of comprehensive income ...... 6 Condensed consolidated interim statement of changes in shareholders’ equity ...... 7 Condensed consolidated interim statement of cash flows ...... 8 Notes to the condensed consolidated interim financial statements ...... 9-18

KPMG Al Fozan & Partners Telephone +966 11 874 8500 Certified Public Accountants Fax +966 11 874 8600 Riyadh Front, Airport Road, Internet www.kpmg.com/sa P. O. Box 92876 Riyadh 11663 License No. 46/11/323 issued 11/3/1992 Kingdom of Saudi Arabia

Independent auditor’s report on review of condensed consolidated interim financial statements To the Shareholders of Etihad Etisalat Company

Introduction

We have reviewed the accompanying 31 March 2020 condensed consolidated interim financial statements of Etihad Etisalat Company (“the Company”) and its subsidiaries (“the Group”) which comprise:

• the condensed consolidated interim statement of financial position as at 31 March 2020; • the condensed consolidated interim statement of profit or loss for the three-month period ended 31 March 2020; • the condensed consolidated interim statement of comprehensive income for the three-month period ended 31 March 2020; • the condensed consolidated interim statement of changes in equity for the three-month period ended 31 March 2020; • the condensed consolidated interim statement of cash flows for the three-month period ended 31 March 2020; and • the notes to the condensed consolidated interim financial statements.

Management is responsible for the preparation and presentation of these condensed consolidated interim financial statements in accordance with IAS 34, ‘Interim Financial Reporting’ that is endorsed in the Kingdom of Saudi Arabia. Our responsibility is to express a conclusion on these condensed consolidated interim financial statements based on our review.

Scope of review

We conducted our review in accordance with the International Standard on Review Engagements 2410, ‘Review of Interim Financial Information Performed by the Independent Auditor of the Entity’ that is endorsed in the Kingdom of Saudi Arabia. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing that are endorsed in the Kingdom of Saudi Arabia, and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

KPMG Al Fozan & Partners Certified Public Accountants, a registered company in the Kingdom of Saudi Arabia, and a non- partner member firm of the KPMG network of independent firms affiliated with KPMG International Cooperative, a Swiss entity.

Independent auditor’s report on review of condensed consolidated interim financial statements (continued)

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying 31 March 2020 condensed consolidated interim financial statements of Etihad Etisalat Company and its subsidiaries are not prepared, in all material respects, in accordance with IAS 34, ‘Interim Financial Reporting’ that is endorsed in the Kingdom of Saudi Arabia.

For KPMG Al Fozan & Partners Certified Public Accountants

Khalil Ibrahim Al Sedais License No. 371

Riyadh on: 20 April 2020 Corresponding to: 27 Shaban 1441H

Etihad Etisalat Company (A Saudi Joint Stock Company) Notes to the condensed consolidated interim financial statements For the three-month period ended 31 March 2020 (All amounts in Saudi Riyals thousands unless otherwise stated)

1 CORPORATE INFORMATION

1.1 Etihad Etisalat Company

Etihad Etisalat Company (“Mobily” or the “Company”), a Saudi Joint Stock Company, is registered in the Kingdom of Saudi Arabia under commercial registration number 1010203896 issued in Riyadh on 14 December 2004 (corresponding to Dhul Qa’adah 2, 1425H). The main address for the Company is P.O. Box 23088, Riyadh 11321, Kingdom of Saudi Arabia.

The Company was incorporated pursuant to the Royal decree number M/40 dated 18 August 2004 (corresponding to Rajab 2, 1425H) approving the Council of Ministers resolution number 189 dated 10 August 2004 (corresponding to Jumada II 23, 1425H) to approve the award of the license to incorporate a Saudi Joint Stock Company under the name of “Etihad Etisalat Company”.

Pursuant to the Council of Ministers resolution number 190 dated 10 August 2004 (corresponding to Jumada II 23, 1425H), the Company obtained the licenses to install and operate 2G and 3G mobile telephone network including all related elements and the provision of all related services locally and internationally through its own network.

Pursuant to the Communication and Information Technology Commission (CITC) resolution number 5125 dated 21 February 2017 (corresponding to Jumada I 24, 1438H), the Company obtained a Unified License to provide all licensed telecommunication services including fixed line voice services and fixed internet.

The Company’s main activity is to establish and operate mobile wireless telecommunications network, fiber optics networks and any extension thereof, manage, install and operate telephone networks, terminals and communication unit systems, in addition to sell and maintain mobile phones and communication unit systems in the Kingdom of Saudi Arabia. The Group commenced its commercial operations on 25 May 2005 (corresponding to Rabi Al-Thani 17, 1426H).

The authorized, issued and paid up share capital of the Company is SR 7,700 million divided into 770 million shares of SR 10 each.

1.2 Subsidiary Companies

Below is the summary of Company’s subsidiaries’ and ownership percentage as at 31 March 2020 and 31 December 2019: Ownership percentage Country of Initial Name incorporation Direct Indirect investment Mobily Ventures Holding S.P.C. Bahrain 100.00% - 2,510 Mobily Infotech India Private Limited India 99.99% 0.01% 1,836 Bayanat Al-Oula for Network Services Company S.P.C. Saudi Arabia 100.00% - 1,500,000 Zajil International Network for Telecommunication Company Saudi Arabia 96.00% 4.00% 80,000 National Company for Business Solutions Saudi Arabia 95.00% 5.00% 9,500 National Company for Business Solutions FZE United Arab - 100.00% 184 Emirates

2 BASIS OF ACCOUNTING

2.1 Statement of Compliance

These condensed consolidated interim financial statements comprise the financial information of the Company and its subsidiaries (together referred to as the ‘Group’).

These condensed consolidated interim financial statements have been prepared in accordance with IAS 34 ‘Interim Financial Reporting’ that is endorsed in the Kingdom of Saudi Arabia and other standards and pronouncements issued by Saudi Organization for Certified Public Accountants.

The condensed consolidated interim financial statements do not include all of the information required for full annual consolidated financial statements and should be read in conjunction with Group’s annual consolidated financial statements for the year ended 31 December 2019.

The condensed consolidated interim financial statements have been approved for issuance on 20 April 2020 (corresponding to 27 Shaban 1441H).

2.2 Basis of measurement

These condensed consolidated interim financial statements have been prepared on historical cost basis unless stated otherwise using the going concern basis of assumption.

2.3 Functional and presentation currency

These condensed consolidated interim financial statements are presented in Saudi Riyal (“SR”) which is the functional currency of the Company. All amounts have been rounded off to the nearest thousands unless otherwise stated.

3 SIGNIFICANT ACCOUNTING POLICIES

The accounting policies applied in these condensed consolidated interim financial statements are in accordance with International Financial Reporting Standards “IFRS” that are endorsed in the Kingdom of Saudi Arabia and other standards and pronouncements issued by SOCPA which are consistent with those that were applied in the Group’s annual consolidated financial statements for the year ended 31 December 2019.

The principal accounting policies applied in the preparation of these condensed consolidated financial statements have been consistently applied to all periods presented.

4 SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS

The preparation of the Group’s condensed consolidated interim financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected in future periods. The significant judgments made by management in applying the Group’s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the Group’s annual consolidated financial statements in accordance with IFRS that are endorsed in the Kingdom of Saudi Arabia and other standards and pronouncements issued by SOCPA for the year ended 31 December 2019.

4 SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS (CONITINUED)

4.1 Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either: • In the principal market for the asset or liability; or • In the absence of a principal market, in the most advantageous market for the asset or liability.

The principal or most advantageous market must be accessible by the Group. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits from the asset’s highest and best use or by selling it to another market participant that would utilize the asset in its highest and best use.

The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the condensed consolidated interim financial statements are categorized within the fair value hierarchy. This is described as follows based on the lowest level input that is significant to the fair value measurement as a whole: • Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities; • Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable; and • Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

For assets and liabilities that are recognized in the condensed consolidated interim financial statements at fair value on a recurring basis, the Group determines whether transfers have occurred between levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period. The Group determines the policies and procedures for both recurring fair value measurement, and for non-recurring measurement.

At each reporting date, the Group analyses the movements in the values of assets and liabilities which are required to be re-measured or re-assessed as per the Group’s accounting policies. For this analysis, the Group verifies the major inputs applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents. The Group also compares the change in the fair value of each asset and liability with relevant external sources to determine whether the change is reasonable. For the purpose of fair value disclosures, the Group has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy, as explained above.

4.2 IMPACT OF COVID-19 The Group’s operations may be affected by the recent and ongoing outbreak of the coronavirus disease 2019 (COVID-19) which was declared a pandemic by the World Health Organization in March 2020. The ultimate disruption which may be caused by the outbreak is uncertain. The telecommunications industry has been designated as an essential service by the Government of the Kingdom of Saudi Arabia and as such the Group continues to operate while taking into account the health and safety of our workforce. Possible effects of the outbreak may include, but are not limited to; disruption to the Group’s customers and revenue, unavailability of products and supplies used in operations and delayed payments by customers. As the Covid-19 outbreak continues to evolve, it is difficult to forecast its full extent and duration of the economic impact as of now. The management of the Group is currently monitoring the situation and its impact on the Group’s operation, cash flows and financial position. Management believes, based on their assessment, that the Group has sufficient liquidity available to continue to meet its financial commitments for the foreseeable future as and when they become due.

5 PROPERTY AND EQUIPMENT Leasehold Telecommunicati Computer Office Capital Land Buildings on network equipment equipment Vehicles work in Total improvements equipment and software and furniture progress Cost: At 1 January 2020 273,192 1,215,488 852,728 42,674,070 5,457,463 423,361 2,774 638 50,899,714 Additions - 359 4,200 398,367 35,215 2,047 - 6 440,194 Disposals - - (38) (2,223) (12,578) (8,242) - - (23,081) At 31 March 2020 273,192 1,215,847 856,890 43,070,214 5,480,100 417,166 2,774 644 51,316,827

Depreciation: At 1 January 2020 - 359,988 698,742 23,443,355 4,338,578 405,222 2,460 - 29,248,345 Charge for the period - 14,904 8,844 634,489 98,547 884 20 - 757,688 Disposals - - (25) (1,701) (12,201) (8,242) - - (22,169) At 31 March 2020 - 374,892 707,561 24,076,143 4,424,924 397,864 2,480 - 29,983,864

Net book value: At 31 March 2020 273,192 840,955 149,329 18,994,071 1,055,176 19,302 294 644 21,332,963 At 31 December 2019 273,192 855,500 153,986 19,230,715 1,118,885 18,139 314 638 21,651,369

During the three-months period ended 31 March 2020, the Group has capitalized internal technical salaries amounting to SR 48 million (31 December 2019: SR 164 million) and no borrowing costs have been capitalized (31 December 2019: SR 22 million).

6 RIGHT OF USE ASSETS

Telecommunic ation network Buildings Land Total equipment Cost: At 1 January 2020 3,694,529 784,378 52,195 4,531,102 Additions 59,195 8,665 - 67,860 Lease cancelation (590) (15,426) - (16,016) At 31 March 2020 3,753,134 777,617 52,195 4,582,946

Depreciation: At 1 January 2020 1,797,616 341,029 13,499 2,152,144 Charge for the period 106,486 33,008 534 140,028 Lease cancelation (282) (5,866) - (6,148) At 31 March 2020 1,903,820 368,171 14,033 2,286,024

Net book value: At 31 March 2020 1,849,314 409,446 38,162 2,296,922 At 31 December 2019 1,896,913 443,349 38,696 2,378,958

7 INTANGIBLE ASSETS

Telecommunic Indefeasible ation services Goodwill Right of Use Others Total licenses (IRU) Cost: At 1 January 2020 13,585,350 1,466,865 1,210,300 97,689 16,360,204 Additions 1,000 - 367 - 1,367 At 31 March 2020 13,586,350 1,466,865 1,210,667 97,689 16,361,571

Amortization: At 1 January 2020 7,089,090 - 606,848 97,689 7,793,627 Charge for the period 69,214 - 21,984 - 91,198 At 31 March 2020 7,158,304 - 628,832 97,689 7,884,825

Net book value: At 31 March 2020 6,428,046 1,466,865 581,835 - 8,476,746 At 31 December 2019 6,496,260 1,466,865 603,452 - 8,566,577

8 INVENTORIES

During the three-month period ended 31 March 2020, the Group has a net written down of SR 7 million (three- month period ended 31 March 2019: a net written down of SR 4.1 million) of inventories. This expense is included in cost of sales in the condensed consolidated interim statement of profit or loss.

9 ACCOUNTS RECEIVABLE

31 March 31 December 2020 2019

Accounts receivable 5,079,759 4,662,411 Less: allowance for impairment loss on accounts receivable (1,673,619) (1,628,189) 3,406,140 3,034,222

The movement of the allowance for impairment loss on accounts receivable is as follows:

31 March 31 December 2020 2019

Opening balance (1,628,189) (2,024,556)

Charge for the period / year (80,536) (45,430) Written off during the period / year - 476,903 Closing balance (1,673,619) (1,628,189) 13

10 RELATED PARTIES TRANSACTIONS AND BALANCES

10.1 Related party transactions

The Group has the following related parties:

Party Relationship Emirates Telecommunication Group Company PJSC Founding shareholder Emirates Data Clearing House Affiliate to Founding shareholder Etisalat Misr S.A.E. Affiliate - Subsidiary to Founding shareholder Etisalat Afghanistan Affiliate - Subsidiary to Founding shareholder Etisalat Al Maghrib S.A (Maroc Telecom) Affiliate - Subsidiary to Founding shareholder Pakistan Telecommunication Company Limited Affiliate - Subsidiary to Founding shareholder Emirates Cable TV and Multimedia LLC Affiliate - Subsidiary to Founding shareholder Sehati for Information Service Company Joint venture

The Group transacted with related parties in ordinary course of business. Following are the details of major transactions with related parties: 31 March 31 March 2020 2019 Interconnection services and roaming services rendered Founding shareholder 14,997 18,159 Affiliates 2,351 4,761 Interconnection services and roaming services received Founding shareholder 62,987 89,270 Affiliates 30,292 9,385 Management fees Founding shareholder 24,617 - Other management expenses Founding shareholder 1,515 (4,840) Other telecommunication services Affiliates 2,317 1,204

Compensation and benefits to key management personnel 31 March 31 March 2020 2019

Short term employee benefits 25,155 37,129 Post-employment benefits 768 541 Total compensation and benefits to key management personnel 25,923 37,670

Services rendered to related parties comprise of the provision of telecommunication service, interconnection services and roaming services by the Group based on normal commercial terms. Services received from related parties comprise of telecommunication service, interconnection services and roaming services to the Group based on normal commercial terms. Management fees and other management expenses are calculated based on the relevant agreements with Emirates Telecommunication Corporation. The balances due to and from related parties are unsecured and will be settled in cash.

Transactions with key management personnel comprise of remunerations to Board of Directors and other senior management members who are key management personnel of the Group.

10 RELATED PARTIES TRANSACTIONS AND BALANCES (CONTINUED)

10.2 Related party balances

31 March 31 December 2020 2019 Due from related parties Founding shareholder 75,978 77,676 Affiliates 4,197 4,424 Joint venture 8,166 8,166 88,341 90,266 Due to related parties Founding shareholder 237,125 233,214 Affiliates 26,657 31,551 263,782 264,765

11 LOANS AND NOTES PAYABLE

31 March 31 December 2020 2019

Long-term loans 12,362,523 12,384,557 Less: current portion (1,371,284) (1,157,017) Non-current 10,991,239 11,227,540 a) Maturity profile of loans and notes payable:

31 March 31 December 2020 2019

Less than one year 1,371,284 1,157,017 Between one to five years 5,796,900 5,329,673 Over five years 5,194,339 5,897,867

12 FINANCIAL ASSETS AND LIABILITIES

12.1 Financial assets

31 March 31 December 2020 2019 Financial assets at fair value: Financial assets - fair value through other comprehensive income * 7,636 7,636 Derivatives financial instruments** 27,359 - Total financial assets at fair value 34,995 7,636

Financial assets at amortized cost: Accounts receivables 3,406,140 3,034,222 Due from related parties 88,341 90,266 Other financial assets 925,237 839,000 Cash and cash equivalents 871,193 1,251,680 Total financial assets at amortized cost 5,290,911 5,215,168 Total financial assets 5,325,906 5,222,804

Current financial assets 5,318,270 5,215,168 Non-current financial assets 7,636 7,636 Total financial assets 5,325,906 5,222,804

12 FINANCIAL ASSETS AND LIABILITIES (CONTINUED)

12.2 Financial liabilities

31 March 31 December 2020 2019 Financial liabilities at fair value: Derivatives financial instruments** 82,083 56,238 Total financial liabilities at fair value 82,083 56,238

Financial liabilities at amortized cost: Loans and notes payable 12,362,523 12,384,557 Lease liabilities 2,443,178 2,509,024 Accounts payable 4,975,277 5,092,583 Due to related parties 263,782 264,765 Other financial liabilities 251,180 275,536 Total financial liabilities at amortized cost 20,295,940 20,526,465 Total financial liabilities 20,378,023 20,582,703

Current financial liabilities 7,343,812 7,222,575 Non-current financial liabilities 13,034,211 13,360,128 Total financial liabilities 20,378,023 20,582,703

* The fair value of these unquoted equity shares was categorized as level 3. ** The fair value of these derivatives financial instruments was categorized as level 2. Fair values of financial assets and financial liabilities measured at amortized cost are not significantly different from their carrying amounts.

13 REVENUE

Consumer Business Wholesale Outsourcing Total 31 March 2020 Usage 2,107,255 165,446 283,882 - 2,556,583 Activation and subscription fees 475,461 115,269 - - 590,730 Others 173,969 192,238 34,469 51,634 452,310 2,756,685 472,953 318,351 51,634 3,599,623

31 March 2019 Usage 1,880,570 108,793 202,040 - 2,191,403 Activation and subscription fees 490,842 97,021 - - 587,863 Others 154,605 161,924 64,680 40,485 421,694 2,526,017 367,738 266,720 40,485 3,200,960

14 BASIC AND DILUTED PROFIT PER SHARE

Basic profit per share is calculated by dividing the profit for the period attributable to ordinary equity holders of the company by the weighted average number of ordinary shares outstanding during the period.

The diluted profit per share is same as the basic profit per share as the Group does not have any dilutive instruments in issue. 31 March 31 March 2020 2019

Profit for the period 130,279 67,250 Weighted average number of shares 770,000 770,000 Basic and diluted profit per share (in SR) 0.17 0.09

15 COMMITMENTS AND CONTINGENCIES

15.1 Capital commitments

The Group has capital commitments resulting from contracts for supply of property and equipment, which were entered into and not yet executed at the condensed consolidated statement of financial position date in the amount of SR 2.03 billion as at 31 March 2020 (31 December 2019: SR 2.26 billion).

15.2 Contingent liabilities

The Group had contingent liabilities in the form of letters of guarantee and letters of credit amounting to SR 1,091 million as at 31 March 2020 (31 December 2019: SR 1,209 million).

The CITC’s violation committee has issued several penalty resolutions against the Group which the Group has opposed to in accordance with the Telecom Status and its implementing regulations. The reasons of issuing these resolutions vary between the manner followed in issuing prepaid SIM Cards and providing promotions that have not been approved by CITC and/or other reasons.

Multiple lawsuits were filed by the Group against CITC at the Board of Grievances in order to oppose to such resolutions of the CITC’s violation committee in accordance with the Telecom Status and its regulations, as follows:

• There are (833) lawsuits filed by the Group against CITC amounting to SR 711 million as of 31 March 2020. • The Board of Grievance has issued (190) verdicts in favor of the Group voiding (190) resolutions of the CITC’s violation committee with a total penalties amounting to SR 506 million as of 31 March 2020. • Some of these preliminary verdicts have become conclusive (after they were affirmed by the appeal court) cancelling penalties with a total amounting to SR 505 million as of 31 March 2020.

Management and the Board of Directors believe that, based on the status of these lawsuits as of 31 March 2020, adequate and sufficient provisions have been recorded.

There are 17 lawsuits filed by some of the shareholders against the Group before the Committee for the Resolutions of Security Disputes and still being adjudicated by the said committee. During Q1 2020, the Company has received (1) preliminary favorable verdict.

The Group is subject to zakat according to the regulations of the General Authority of Zakat and Tax (GAZT) in the Kingdom of Saudi Arabia. The Group files its zakat returns on a consolidated basis, starting from the financial year ended 31 December 2009 and thereafter, where it includes the Company and its subsidiaries due to the fact that the Group is one economic entity wholly owned and managed by the Company.

The Group has filed its zakat returns with GAZT for the years through 2018 and settled its zakat thereon. During the year ended 31 December 2016, the Group submitted adjusted zakat returns for the years 2013 and 2014, as a result of restatement of the consolidated financial statements for the said years.

The Group has finalized its zakat status for the years up to 2008. The Group has received zakat and withholding tax assessments for the years 2009, 2010 and 2011 that showed additional zakat and withholding tax liabilities of SR 226 million and SR 159 million respectively, which have been appealed against by the Group at the Preliminary and Higher Appeal Committees. Recently, the Higher Appeal Committee has issued certain rulings in favor of the company related to zakat and withholding tax disputes. Management believes that it has sufficient grounds to contest the matters included in the assessments and the eventual outcome of the appeal process will not result in any significant liability.

16 SEGMENT INFORMATION

Information regarding the Group’s operating segments is set out below in accordance with IFRS 8 Operating Segments. IFRS 8 requires operating segments to be identified on the basis of internal reports that are regularly reviewed by the Group’s chief operating decision maker (“CODM”) and used to allocate resources to the segments and to assess their performance.

The Group is engaged in a single line of business, being the supply of telecommunications services and related products. The majority of the Group’s revenues, profits and assets relate to its operations in the Saudi Arabia. The operating segments that are regularly reported to the CODM are Consumer, Business, Wholesale and Outsourcing.

The CODM used to receive other operational financial aggregates on a group consolidated level. This is the measure reported to the Group’s Board of Directors for the purpose of resource allocation and assessment of segment performance.

31 March 31 March 2020 2019 Consumer revenues 2,756,685 2,526,017 Business revenues 472,953 367,738 Wholesale revenues 318,351 266,720 Outsourcing revenues 51,634 40,485 Total revenue 3,599,623 3,200,960 Total cost of sales (1,534,223) (1,362,251) Total operating expense (780,216) (566,443) Depreciation and amortization (988,914) (968,598) Impairment loss on property and equipment - (27,000) Total non-operating expense (151,812) (200,822) Capital expenditures 441,561 781,527

17 SUBSEQUENT EVENTS No material events occurred subsequent to the reporting date, which could materially affect the condensed consolidated financial statements, and the related disclosures for the three-month period ended 31 March 2020.